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Integration of Hydrogen Production via Water Electrolysis at a CHP Plant A feasibility study Anton Ottosson Sustainable Energy Engineering, master's level 2021 LuleΓ₯ University of Technology Department of Engineering Sciences and Mathematics

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Page 1: Integration of Hydrogen Production via Water Electrolysis

Integration of Hydrogen Production via

Water Electrolysis at a CHP PlantA feasibility study

Anton Ottosson

Sustainable Energy Engineering, master's level

2021

LuleΓ₯ University of Technology

Department of Engineering Sciences and Mathematics

Page 2: Integration of Hydrogen Production via Water Electrolysis

Preface

This report was made with the purpose to investigate the possibilities of producing hydrogen

(H2) and oxygen (O2) by water electrolysis via an electrolyzer at a heat & power plant. It is

written by Anton Ottosson, as a part of a Master Thesis project associated with a Master of

Science in Engineering education at LuleΓ₯ Tekniska Universitet.

This report is also hoping to aid in the Sustainable Development Goals as goals like 7, 9, 11,

12, and 13 can be affected by this report [2]. The project can participate in the promotion of

potential production of fossil free H2, to be used as a fuel or energy-storing agent in the

future, to fight climate change. It can also contribute by rewarding discussions revolving

around the benefits of integrating an electrolyzer at a CHP, both for the climate and the

efficiency of the industry.

Special thanks to:

Kentaro Umeki, professor, and supervisor from LTU, for generous help and excellent

guidance during all parts of the project.

E.ON for cooperation, and especially the Γ–rebro office, for having me do my Thesis project

at their site.

Rufus Ziesig & Jonas Elliot, site managers and supervisors from E.ON, for a very

professional cooperation and valuable guidance during the project.

Fredrik Lind, Magnus BokΓ©n, Agneta BΓ€ckman and Maria Grahn for advice and rewarding

discussions during the project

I would also like to thank various other persons, companies, and organizations for help

regarding information under the project.

I would also like to thank my closest and family for their support during the period of the

project.

Anton Ottosson

4/16/2021

Γ–rebro

Page 3: Integration of Hydrogen Production via Water Electrolysis

Abstract

Hydrogen gas (H2), that is not produced from fossil oil or natural gas, is expected to become a

cornerstone in the energy transition strategy in Europe. The recent years, technological and

economic advances in the electrolyzer area, along with political and corporate support, have

put H2 at the forefront of many countries’ climate change agenda. Consequently, green H2 is

poised to play a large role in the coming energy transition to combat climate change.

The possible advantages of integrating H2 production with a combined heat and power plant,

or CHP, is investigated in this study. More precisely, the water electrolysis is carried out

based on the purified flue gas condensate water and excess heat is recovered as district

heating. A comparison of today’s three most common electrolyzer technologies was made,

where Proton Exchange Membrane, or PEM, technology was chosen for this project, mainly

for its high purity of H2 gas, robust construction, and the ability to run it as a fuel cell.

Based on a mass and energy balance, a model including the integration of a PEM with a

generic CHP plant was developed. The model was made modifiable, making it possible to

change governing parameters, to be able to investigate different possible scenarios.

Production flows, losses and other relevant data was calculated from the model. Operational

data for the PEM electrolyzer were collected from several manufacturers where a mean value

of the data was used as a base-case for the calculations. Based on literature and consulting

experts, several assumptions were made, for example the selling price of H2 and the price for

electricity. From the base-case were two cases made: a linear and non-linear case. The linear

case uses the same input data each year for 20 years, while the non-linear case uses a

changing input data each year for 20 years.

Calculations were based on an electrolyzer size of 1,4 MW, where auxiliary equipment

consumed additional 0,04 MW, resulting in a total energy consumption of 1,44 MW. An

operational temperature of 80Β°C was assumed along with an operational pressure of 5 and 30

bar for the anode and cathode respectively. This resulted in an H2 production flow of 26 kg/h,

a process water requirement of 0,2 m3/h, and a possible heat recovery amount of 0,34 MWh

with a relevant temperature for the use in district heating.

The study shows that the condensate-water at E.ON could provide for ~4000 hours of

operation in the wintertime. To enable full operation all year around, a purchase of tap water

would be necessary.

The economical calculations resulted in an H2 production cost of 53 SEK/kg for the linear

case and 58 SEK/kg for the non-linear case. The linear case showed a positive internal rate of

return, or IRR, of 1,7%, while the non-linear case resulted in IRR < -25%. A sensitive

analysis was made to examine governing parameters. The results of the sensitivity analysis

showed that the largest driving variables, that significantly affect the IRR, are the price for

electricity and the selling price for H2. The largest OPEX cost was found to be the price of

electricity.

The results showed that it is feasible to produce H2 at E.ON Γ–rebro in a resource efficient

way under certain circumstances, correlated to the electricity and H2 market. With a low

electricity price and a selling price of ~50 SEK/kg for H2, good profitability is expected.

It is also clear that future work should focus the areas of O2 usage, infrastructure, and market

investigation for a more definitive conclusion.

Page 4: Integration of Hydrogen Production via Water Electrolysis

Table of Contents

1 Introduction..................................................................................................................... 1

1.1 Background .................................................................................................................. 1

1.2 Purpose and goals ......................................................................................................... 2

2 Hydrogen production by electrolysis of water ............................................................. 2

2.1 Electrolyzer technologies ............................................................................................. 3

2.1.1 ALK, Alkaline Electrolyzer .................................................................................. 4

2.1.2 PEM, Proton Exchange Membrane Electrolyzer ................................................ 4

2.1.3 SOEC, Solid Oxide Elctrolyzer Cell .................................................................... 5

2.1.4 Other technologies ............................................................................................... 6

2.2 Water quality ................................................................................................................ 7

2.3 Purification and drying of produced H2 and O2 ............................................................ 7

2.3.1 Purification .......................................................................................................... 7

2.3.2 Drying .................................................................................................................. 8

2.4 Byproducts ................................................................................................................... 9

2.4.1 Heat production ................................................................................................... 9

2.4.2 O2 production ...................................................................................................... 9

2.5 Operational problems with the electrolyser .................................................................. 9

2.5.1 Contamination coverings ..................................................................................... 9

2.5.2 Limestone, metals and ”fouling” ......................................................................... 9

2.5.3 Gas crossover ...................................................................................................... 9

2.6 Application of hydrogen gas ...................................................................................... 10

3 Theory and methods ..................................................................................................... 10

3.1 Operation of the Electrolyzer ..................................................................................... 10

3.1.1 Ohmic losses ...................................................................................................... 12

3.1.2 Faradaic losses .................................................................................................. 12

3.1.3 Heat production ................................................................................................. 12

3.1.4 Water formation in anode/cathode and unwanted gas in the production flows 12

3.2 Mass and Energy balance ........................................................................................... 13

3.3 Efficiency ................................................................................................................... 15

3.4 Economy ..................................................................................................................... 16

3.4.1 Production cost, payback time and Internal rate of return ............................... 16

Page 5: Integration of Hydrogen Production via Water Electrolysis

3.4.2 Input data for the base case ............................................................................... 17

3.4.3 Linear case ........................................................................................................ 18

3.4.4 Non-linear case .................................................................................................. 18

4 Results and discussion .................................................................................................. 19

5 Conclusions .................................................................................................................... 28

6 Future work ................................................................................................................... 29

6.1 Internal usage of O2 .................................................................................................... 29

6.2 Market for H2 and O2 .................................................................................................. 29

6.3 Infrastructure .............................................................................................................. 29

References .............................................................................................................................. 30

Page 6: Integration of Hydrogen Production via Water Electrolysis

Abbreviations Variables

AEM Anion Exchange Membrane A Area (m2)

ALK Alkaline (electrolyzer type) Cp Specific Heat capacity (KJ/kg K)

CAPEX Capital Expenditure Cv Molar Heat Capacity (KJ/mol K)

CHP Combined Heat and Power e- Electron

CO2 Carbon Dioxide F Faraday’s constant (96485 𝑐/π‘šπ‘œπ‘™)

EU European Union H+ Proton (positive charged hydrogen)

EXP Expenditure h Enthalpy (KJ/mol)

H2 Hydrogen Gas I Current (Ampere)

HHV Higher Heating Value M Molar mass (kg/mol)

IRR Internal Rate of Return m Mass (kg)

kg Kilogram m Mass flow (kg/s)

kW Kilo Watt n Number (pcs)

kWh Kilo Watt Hour n Amount of substance (mol)

NOX Nitrogen Oxides n Molar flow (mol/s)

O2 Oxygen Gas P Pressure (Bar)

OPEX Operational Expenditure Q Energy (Joules)

PEM Proton Exchange Membrane T Temperature (℃elcius)

PROD Production V Voltage (Volt)

PSA Pressure Swing Adsorption Z Number of electrons (pcs)

REV Revenue V Volume (m3)

SEC Specific Energy Consumption W Watt (Joules/s)

SOEC Solid Oxide Electrolyzer Cell βˆ†G Gibs Free Energy (KJ/mol)

II Initial Investment βˆ†H Enthalpy (KJ/mol)

SR Stack Replacement βˆ†S Entropy (KJ/mol)

Ι£ Specific heat ratio (mol/kg)

αΆ― Efficiency (%)

ρ Density (kg/m3)

Page 7: Integration of Hydrogen Production via Water Electrolysis

1

1 Introduction The world is facing a crisis in the quest for a sustainable energy source, to help phase out or

replace fossil fuels. Hydrogen gas, which can act as an energy carrier, energy-storing agent

and a possible source of power generation, has in recent years become a more relevant and

interesting option as a complement to other renewable sources.

The idea to use electrolysis of water, powered by renewable energy sources to produce, so

called, green H2 gas, has been around for quite some time. But in the recent years, the market

has exploded exponentially with a demand for H2-powered products. This in turn has created

a larger demand for H2, which currently are mainly used in industrial processes.[12][18]

The utilization of H2 in areas other than industry has been a sensitive and prejudiced subject

for many years. The flammable nature of H2 remind most people of events like the

Hindenburg disaster when spoken of outside of industrial usage. Water electrolyzers have

also been used to a relatively small extent with a limited market. H2 is cheaper to produce

from fossil fuels, resulting in unprofitable H2 production by water electrolysis. Consequently,

electrolyzers have been relatively expensive equipment. [18][42]

H2 is a hotter topic of conversation now than ever with its great flexibility and a wide area of

usage [9], and the possibility to be produced in a green environmentally friendly way

[18][20]. Some few examples of where H2 can be utilized are in the industry, as an energy

storing medium, or in Fuel Cells for electricity production or powering mobile vehicles. The

development of existing and new electrolyzer technologies has rapidly accelerated in the last

years as a result [12][18]. By using renewable energy to drive the electrolysis of water, green

H2 is produced and can contribute to the fight against climate change. Large companies are

now becoming the leading drive force in the development of the water electrolysis market,

which may drive the price tag down.[3][32][31]

A future where H2 contributes as an important complement in different sectors seems to be

approaching reality. The question remains whether H2 might be the answer to many of today’s

energy problems, and it has been right in front of our noses all along.

1.1 Background At E.ON’s CHP plant in Γ–rebro, flue gas condensate water is extracted and purified for usage

as process water in the boilers again. The amount of condensate water differs with the time of

the year. During the winter times, there is a surplus of the condensate water, and it is released

into the river running through Γ–rebro city. The purity level of the surplus water is in general

of more than sufficient quality for the use in the electrolyzer but differs in purity quality. In

some cases, it is purified to levels close to battery water [7]. The amount of condensate

produced is directly linked to the number of boilers that are under operation. It can be

regarded as a waste to release purified excess water without putting it to use. Furthermore, the

CHP has great integration possibilities with their existing district heating network to take

advantage of. Furthermore, other infrastructure such as power supply and also service

personnel are already on site.

With this background, this project addresses the idea of using this surplus water to produce H2

and O2 gas through electrolysis of water. The primary question is what benefits an integration

of an electrolyzer at a CHP plant can provide. The question of how favorable and profitable

such an investment could be, gave rise to this feasibility study. However, the possibilities for

Page 8: Integration of Hydrogen Production via Water Electrolysis

2

further integrating water electrolysis with a CHP plant, and thereby to lower the production

cost for the plant have not been examined due to limited time.

1.2 Purpose and goals It has already been proven that to achieve a profitable business by the production of H2 via

water electrolysis is a possible concept [16][22][24][29]. It has also been proven that to place

an electrolyzer close to renewable electricity production facilities, such as wind and solar

parks, is a somewhat successful concept [17][26][30]. However, there are limited numbers of

studies that investigated the advantages and disadvantages of placing and integrating an

electrolyzer at a CHP plant. This applies not only specifically at a CHP plant, but also heat

production facilities in general.

The main goal is described as the following:

To find out if it's possible to produce H2 at Γ…byverket in a resource efficient way.

To answer this question, the following goals were set for the study:

β€’ To develop and evaluate a technical solution (on a system level) for

how an electrolyzer can be integrated with other components such

as heat pumps, compressors, storage tanks, fuel cells etc.

β€’ To evaluate the performance of the suggested system through a

techno-economic analysis.

β€’ To identify the possibilities to place such a process at E.ON VΓ€rme

in Γ–rebro.

2 Hydrogen production by electrolysis of water Production of hydrogen by electrolysis of water has been performed for quite some time. In

the early 1800s, two English scientists, William Nicholson and Anthony Carlisle, discovered

that H2O could be split into its two components, H2 and O2, with the use of

electricity[13][1][17]. The concept was proven successful by other scientists and saw further

development. In the 1900s, electrolyzers were used to produce H2 and O2 gases on an

industrial scale.[13][1][17]

Since the 1900s, the alkaline water electrolysis technology, or β€œALK”, has continued to

develop and is a mature technology today. It has seen the use in different countries over the

years in varying scale. Norway for example, had H2 production on megawatt scale by ALK

electrolyzers in the middle of the 20th century. [1][17]

More recent years, other electrolyzer technologies have been developed to counter the

drawbacks of ALK, such as current densities and the relatively low purity of the H2 gas. Two

examples are the β€œProton Exchange Membrane”, referred to as β€œPEM”, and the β€œSolid Oxide

Electrolyzer Cell”, referred to as β€œSOEC”, technologies. In recent years, these technologies

have seen rapid development and have been given large attention in the research area.[12][13]

Page 9: Integration of Hydrogen Production via Water Electrolysis

3

Figure 1: Early industrial grade electrolyzer [8]

Research and development of electrolyzers have historically been driven with the sole intent

of producing H2 more efficiently. Today, besides trying to increase efficiency, the research

focus has shifted more towards economic profitability. Hopefully resulting in the production

of cheap, green H2 and at the same time make a positive contribution to the environment. [34]

2.1 Electrolyzer technologies Different types of electrolyzer techniques were evaluated in this project for the purpose to fit

E.ONs demands. After the initial screening, the three most common electrolyzer techniques

on today’s market are examined in detail. This decision was made as it is unrealistic to invest

in immature technologies.

The three most common technologies today are ALK, PEM, and SOEC, [9][19][29] and their

main characteristics are summarized in Table 1.

The purpose of all three technologies is to split water into O2 and H2. However, the

technologies have different methods of achieving electrolysis, with the use of different charge

carriers and environments in which the electrolysis takes place.

Table 1: Some of the technical differences of the covered electrolyzer types [18][34][35].

ALK (alkaline water electrolysis)

PEM (Proton Exchange Membrane)

SOEC (Solid Oxide Electrolyzer cell)

Environment type Alkaline Acidic Superheated Steam

Technical maturity Commercial Commercial

Research &

Developmentb

Electrolyte type KOH liquida Polymer membrane Ceramic membrane

Charge carrier OH- H+ O2-

a = Commonly used[Fel! Hittar inte referenskΓ€lla.] b = Demonstration and smaller facilities exist.

Page 10: Integration of Hydrogen Production via Water Electrolysis

4

2.1.1 ALK, Alkaline Electrolyzer

ALK is the oldest and the simplest technique of producing H2 and O2 gas through water

electrolysis. An ALK cell is based on an anode & cathode side, submerged in a bath of

electrolyte, typically a KOH solution [9][13][18]. A membrane is separating the two sides,

often made of a polymeric material. A current is forced through the anode and cathode. It

causes the water to release negatively charged hydroxide ions from the cathode side to the

anode side. O2 gas and water are produced at the anode side and H2 gas and OH- ion at the

cathode side. The gas rises from respective electrodes and the gas can then be extracted,

purified, and prepared for usage. [18]

Figure 2: Structure of the ALK cell.

There are several advantages with ALK electrolysis technology. ALK uses common metals

for the anode and cathode, typically Nickel and Copper [9][18], which makes it one of the

cheapest technologies. ALK technology has also been around the longest and is, in the current

day, the most mature and commercialized technology.

One of the larger disadvantages of the technology is the alkaline environment it is operating

in. This environment will cause some of the equipment, such as cathode and anode, to

degrade over time which will increase maintenance costs [19]. By having the electrodes

submerged in a KOH solution, traces of the electrolyte will be present in the H2 flow,

lowering the purity.

2.1.2 PEM, Proton Exchange Membrane Electrolyzer

PEM is a technology developed in the last 50 years. The PEM technology was mainly

developed to counter the drawbacks of ALK electrolyzers and it is the same technology used

in several fuel cells. A PEM electrolyzer eliminates the usage of a liquid electrolyte and

instead uses a solid polymeric membrane to produce H2 gas that significantly increases the

purify of the gas. As the name suggests, the PEM electrolyzer transports H+ (protons) from

the anode to the cathode side, driven by pressure difference, to produce H2 gas. The PEM cell

Page 11: Integration of Hydrogen Production via Water Electrolysis

5

structure consists of several layers of rigid metal plates, allowing greater pressures to be used

in the reaction [9][12][13]. The plates contain channels for the process water, the H2 and O2

gas, and the cooling water circuit. Water is feed into the anode plate where a current and

voltage is applied. H+ (protons) travel through the membrane from the anode side to the

cathode side where H2 gas is formed. As a result, O2 is produced on the anode side and leaves

the electrolyzer with leftover H2O.

Figure 3: PEM structure.

The PEM process is typically fed with ⁓80℃ water [9] [11][12]. The possibility of increased

operational pressure in the cathode, thanks to the rigid construction of the cells, can be

exploited to lower the cost of compression of the produced H2 gas. This pressure is commonly

set to around 30 bar [12][1]. Since the cell structure of the PEM is based on several plates

with separate channels for gasses and water, the PEM can be operated in reverse order to be

used as a fuel cell. If it is used for the electrolysis of water, it is commonly referred to as

β€œPEMEL” or β€œPEM”, and β€œPEMFC” as fuel cell.

Since the operation of the PEM with a high concentration of H+ ions create an acidic nature,

the materials for the anode and cathode must be corrosion-resistant. This results in one of the

larger disadvantages with the technology, which is the need for rare metals in the anode and

cathode. Typical materials used are platinum and iridium, which increases the cost. [19]

The first PEM was been developed by the company General Electric in the 1960s to

overcome the disadvantages of ALK technology [9][11][13].

2.1.3 SOEC, Solid Oxide Elctrolyzer Cell

In the most recent years, SOEC has been seeing more and more development because of its

potential of very high efficiencies. Unlike ALK and PEM technology that uses water at ~70 -

90Β°C, SOEC instead uses high-temperature steam to achieve electrolysis, often at

temperatures around 700 – 800 ℃ [9][11][27]. SOEC, like a PEM, can be operated both as an

electrolyzer, and a fuel cell, then commonly referred to as a β€œSolid Oxide Fuel Cell”, or

Page 12: Integration of Hydrogen Production via Water Electrolysis

6

β€œSOFC”. Like the PEM, the SOEC uses a solid electrolyte in the form of a membrane. But

unlike the PEM membrane which commonly is made of a polymeric material, the membrane

used in a SOEC is made of ceramics [27][9].

The SOEC cell is feed with steam, typically at around 750℃, into the cathode. When a

voltage and current are applied, O2 ions transfer through the electrolyte while H2 is formed in

the cathode. Some steam is also present in the H2 stream and needs to be removed at a later

stage. The H2 continues along with the cathode and the O2 ions transfer to the anode and

emerges as pure O2 gas. The high operating temperatures of the cell create increased demands

on the solid electrolyte to be able to handle the temperatures and the increased wear that can

result from this. A common material used as the electrolyte is Zirconia Dioxide [9][23][27],

because of its high melting temperature, strength, and high resistance to corrosion

characteristics. The SOEC, much like ALK technology, is not capable to produce H2 at a

pressure and therefore need an initial compression stage.

Figure 4: Solid Oxide Electrolyte Cell structure.

Since the SOEC is operating under very high temperatures, the efficiency can be increased by

smart heat management. This also brings challenges for the demand of very hot steam,

especially in large quantities. Unlike ALK and PEM, the SOEC needs a large heat source to

operate.

2.1.4 Other technologies

The technologies listed above are the most common ones today, but other less common

technologies do exist. These technologies are not ready for commercial use compared to

ALK, PEM, and partly SOEC. Since the PEM, ALK, and SOEC technologies have their clear

advantages and disadvantages, new technologies are under development to counter the

disadvantages of each technology [9]. One example is the usage of different organic

wastewaters for microbial electrolysis [9].

Another is AEM technology, or β€œAnion Exchange Membrane”, which combines the

advantages of low-cost material and the environment from ALK and the higher efficiency and

Page 13: Integration of Hydrogen Production via Water Electrolysis

7

current densities of a PEM electrolyzer [41]. It is worth noting that this technology is under

development and is currently only available on a very small scale for home appliances, but

technologies like this make the future for H2 production via water electrolysis brighter.

2.2 Water quality The quality of the feed water is a critical variable in the water electrolysis,[18] as the lifetime

of the electrolyzer is significantly lowered if the water quality is poor and minerals can cause

fouling or even damage to the machine and membrane. Contamination coatings can also be

formed on either the cathode and/or anode, depending on the technology [40].

Regular tap water is most often of insufficient quality, but only needs some treatment to

deionize the water. Nevertheless, the cleaner the feed water is, the better. Since there is

already an existing water treatment facility on Γ…byverket, the water quality is of no concern.

At times when tap water is needed to supply the electrolyzer, the existing water cleaning

equipment can be used. A water treatment component can be skipped in future investment,

which is an advantage of integration with CHP plants.

The amount of chloride, magnesium, and calcium in the feed water should be minimized

since large quantities of these minerals can affect the membrane and the platinum cathode

[18]. Acidic systems like the PEM are generally less tolerant to these elements than for

example ALK systems, which are operated under alkaline conditions [13].

2.3 Purification and drying of produced H2 and O2 ALK, PEM, and SOEC all produce H2, but in different ways, as mentioned in section 2.1.

This results in different needs for purification and drying of the production flow of H2. Table

2 below shows a comparison between the type of electrolyte, purity of gas, and which

pollutants can usually occur with each technology.

Table 2: Comparison between the different contaminations encountered in the respective

technology [18][34][35].

ALK PEM SOEC

Electrolyte type Typically, 30% wt

KOH solution

Solid Polymer

membrane

Solid Ceramic

membrane

Purity of H2 flow (%) ~99,5 =< 99,99 ~99,9a

Major contamination

in H2 flow

H2O, trace of

electrolyte Trace of H2O H2O

a = no reference provided; values estimated based on collected information [Fel! Hittar inte referenskΓ€lla.]

2.3.1 Purification

In the electrolysis process, the splitting of water will lead to two separate product flows of H2

and O2, with some unwanted formation of water vapor in both flows. Depending on the

technology, different types of contaminations may also occur and pollute the gas flows. In

this case, the purity of the H2 flow is of greatest interest.

Contaminations in the production flow can be of solid, gaseous, and liquid form and most of

the contaminations encountered can be removed, with different methods. The types and

amount of contaminations in the production flow are often caused by water quality, wear over

time, technology, and the operating pressure in the cathode and anode. Hence, the feed water

Page 14: Integration of Hydrogen Production via Water Electrolysis

8

quality is important for both the lifetime of the machines and the purity level of the produced

H2.

Table 3: Brief summary of possible contaminants in H2 produced from electrolyzers.

Solid contaminations Liquid contaminations Gaseous contaminations

Solid contaminations, such as particles

of rust & dirt are often occurring in

small quantities and are a product of

long-time operation. Solid particles

from plastics and gaskets can also occur

in the production flow, these are often

caused by faulty/bad maintenance.

Solid particles are relatively easily

removed with the correct equipment.

Liquid contaminations are for the most

part unwanted formation of water from

the feed water, often in the anode or

cathode. Except for H2O, the most

common liquid contamination is from

the electrolyte. This requires the

technology to use a liquid electrolyte,

like ALK technology. For example,

small quantities of particles from the

KOH solution in an ALK electrolyzer

can end up in the H2 production flow.

These liquid particles are commonly

removed with coalescing filters or

similar techniques.

Gaseous contaminations should

normally only consist of water vapor. If

oxygen, nitrogen, and argon are present

in the production flow, a leak is feasible

but rarely occurring since the systems

are pressurized above atmospheric

pressure and no other gases should be

able to enter the system. O2 in the H2

flow is seen as contamination and often

a result of β€œgas crossover”. The H2 is

easily purified from the unwanted O2

with techniques such as PSA.

Scrubbing is necessary for ALK systems, since small quantities of the electrolyte, typically a

solution of KOH, end up in the production flow.

Unwanted formation of O2 in the production flow is more common in PEM electrolyzers. The

O2 can be removed in several ways, but the most common method is by either pressure swing

adsorption, referred to as PSA, or a catalytic purification with drying.

The β€œall in one solution” for water vapor, solid, liquid, and gaseous contaminations are a

Palladium-silver membrane. This membrane purifies the H2 gas from almost any unwanted

substance and purifies the H2 to a >99,9999% purity [33]. The significant drawback with the

usage of this membrane is the extremely high price of palladium and the R&D status. The

most common contamination overall is unwanted H2O in gas and liquid form, which need to

be removed [14].

2.3.2 Drying

Even with a high conversion efficiency, robust construction, and favorable pressure

circumstances, some unwanted H2O will eventually form in produced H2. The process of

removing the unwanted H2O is often referred to as β€œdrying”, which can be performed in

several ways. The most suitable solution to remove water from the H2 differs depending on

which technology is used to produce H2. For a PEM, small amounts of O2 will be formed in

the cathode, see section 3.1.4, which eventually will react with a small amount of H2 and form

H2O. This water will take liquid form and can simply be removed by a water collector unit as

it will accumulate with the help of gravity. [15][12]

A well-known and widely used method for gas purification is Pressure Swing Adsorption, or

PSA [14][15]. The technology is operated by pressure difference with the usage of porous

layers that the target gas can diffuse through and the waste gas can be purged away after a

cycle. It can be performed on large scale with little downtime to a relatively low cost with a

purity of the H2 flow off up to 99,999% [15]. The downside of using PSA as a purification

method is that a portion of the produced H2 is lost to β€œpurge” the PSA unit between cycles to

Page 15: Integration of Hydrogen Production via Water Electrolysis

9

regenerate the unit. This loss in production corresponds to 15 – 30 % of the total production

[33].

2.4 Byproducts

2.4.1 Heat production

In the electrolysis process, a large amount of unwanted heat is produced. This heat production

is at a scale large enough that it creates a cooling demand for the PEM stack. It is common to

have a cooling system installed on the roof of the electrolyzer construction and the heat is

most often ventilated as it is seen as non-recoverable waste heat. By placing the electrolyzer

close to a CHP, the waste heat can be recovered in the district heating system, which in turn

can provide cooling for the PEM stack. [12]

2.4.2 O2 production

Besides producing H2, the electrolyzer does also produces O2 as a by-product. It is common

for manufacturers to not supply purification and drying solution for the O2 gas since the O2 is

of less interest than the H2. This O2 gas is of low value if the electrolyzer should be placed

off-site, but new possibilities arise if the electrolyzer is in the proximity of a CHP or any other

combustion plant where the O2 possibly can be used beneficially in the combustion

process.[26]

2.5 Operational problems with the electrolyser

2.5.1 Contamination coverings

Unwanted formation of contamination layers in the electrolyzer is an existing problem. In the

PEM electrolyzer, the formation of oxide layers on the anode is a known problem. Research

are taking place on this and how to counter this, and related problems [13][20][27]. Suggested

solutions are to coat the anode for protection or use Titanium, for its corrosion-resistant

capabilities [13][19].

2.5.2 Limestone, metals and ”fouling”

If the water quality of the process water does not meet the specified demands of the

electrolyzer and for example contains limestone, β€œfouling” and other layers of contamination

can form in parts of the machine, affecting and lowering the electrolyzers work efficiency. A

high concentration of metals in the water, such as magnesium, can cause similar problems.

The best way to avoid this is to use deionized water with minimal amounts other substances.

Checking fouling and possible layers of contamination is a part of the maintenance work. [40]

2.5.3 Gas crossover

Gas crossover is a phenomenon where, for example in a PEM electrolyzer, small amounts of

unwanted O2 can be formed in the cathode and small amounts of unwanted H2 can be formed

in the anode. In this case, the O2 crossovers the membrane and mixes with the H2 flow on the

cathode side, which creates additional costs to remove the O2 and purify the gas flow.

Since the quantities of O2 gas crossing into the H2 flow are so small, this amount of O2 often

instantly reacts with a small amount of H2 and forms H2O. The water is easier to remove and

often makes the gas crossover problem less of an issue in PEM electrolyzers. This problem is

often related to the operating pressure and the thickness of the polymer membrane used in the

PEM.

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2.6 Application of hydrogen gas H2 is quite flexible and can be used in a great many things. Since the electrolyzer uses PEM

technology, the electrolyzer can be used as a fuel cell. That opens the possibility to store H2,

produced when electricity is cheap for later use to produce electricity at times when the

electricity price is high.

H2 is commonly used in various parts of the industry [12][14][18]. The major usage of H2 is

for the production of ammonia to produce fertilizer, among other things [9] [11]. Some other

common areas of usage for H2 are listed below.

β€’ The H2 can react with O2 in a fuel cell, creating electricity and heat. Fuel cells can for,

example, be used in vehicles and to produce electricity. Storing the H2 for later

electricity production can be favorable if electricity prices vary greatly. [25]

β€’ By combining carbon capture and use CO2 with H2 gas, methanol can be produced.

[39]

β€’ The H2 gas can be used in gas turbines for electricity production. [24]

β€’ By either using a fuel cell or a gas combustion engine, the H2 gas can be used as a

fuel for vehicles. [39][28]

β€’ H2 is a useful gas in the industry sector. Upcoming industrial projects, like HYBRIT

[36], will create a significant demand for large quantities of H2 gas in the future.

3 Theory and methods

3.1 Operation of the Electrolyzer It is known that for the water-splitting reaction to occur, the energy for βˆ†π» must be provided,

which applies for all the electrolyzer technologies like the following:

𝐻2𝑂 β†’ 1

2 𝑂2 + 𝐻2 π‘€β„Žπ‘’π‘Ÿπ‘’ βˆ†π» = 285,85 π‘˜π½/π‘˜π‘” ( 1 )

Where βˆ†π» is the sum of:

βˆ†π» = βˆ†πΊ + π‘‡βˆ†π‘† ( 2 )

Where:

βˆ†πΊ = 237,13 π‘˜π½/π‘˜π‘” ( 3 )

π‘‡βˆ†π‘† = 48,72 π‘˜π½/π‘˜π‘” ( 4 )

βˆ†G is Gibbs free energy, which in this case is the minimal amount of electrical energy needed

for the reaction. To reach βˆ†π», the remaining energy is provided by heat from the environment

in the form of entropy, here as π‘‡βˆ†π‘†. Here is where the technologies differ.

A SOEC electrolyzer that operates with high-temperature steam can provide π‘‡βˆ†π‘† as heat. By

smart heat management the energy consumption decreases and efficiency increases.

ALK and PEM technologies are unable to provide the energy as heat and therefore need to

provide all energy via electricity. This means that for PEM, βˆ†π» is equal to:

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βˆ†πΊ = βˆ†π» = 285,85 π‘˜π½/π‘˜π‘” ( 5 )

Where the reaction for each electrode in the PEM is the following:

πΆπ‘Žπ‘‘β„Žπ‘œπ‘‘π‘’ π‘Ÿπ‘’π‘Žπ‘π‘‘π‘–π‘œπ‘›: 2𝐻+ + 2π‘’βˆ’ β†’ 𝐻2 ( 6 )

π΄π‘›π‘œπ‘‘π‘’ π‘Ÿπ‘’π‘Žπ‘π‘‘π‘–π‘œπ‘›: 𝐻2𝑂 β†’ 2𝐻+ + ½𝑂2 + 2π‘’βˆ’ ( 7 )

The construction of the cells for the different electrolyzers technologies also differs and leads

to different methods for calculating their operational conditions.

The PEM electrolyzer cell consists of several metal plates with a polymeric membrane in the

center. Several of these cells together are called a stack, where the electrolysis reaction is

taking place. Each cell in the PEM requires a minimal theoretical voltage for the splitting

reaction to occur and can be calculated as the following:

𝑉𝑐𝑒𝑙𝑙,π‘‘β„Žπ‘’π‘œπ‘Ÿπ‘’π‘‘π‘–π‘π‘Žπ‘™π‘™ =βˆ†π»

π‘§βˆ—πΉ= 1,48 𝑉 ( 8 )

Where Faradays constant is 𝐹 = 96485 𝑐/π‘šπ‘œπ‘™ and the number of electrons is Z = 2. At this

voltage, the electrolyzer will operate with 100% efficiency.

The real required voltage for the cell is going to be higher than the theoretical minimal

voltage, due to losses in the cell, as described more in section 3.1.1 & 3.1.2. Each cell also

requires a current to operate. The real required voltage and current can be calculated, but

since this is considered out of scope for this project, they are assumed as the following, based

on literature, previous and similar work [12].

𝑉𝑐𝑒𝑙𝑙 = 1,85 𝑉 ( 9 )

𝐼𝑐𝑒𝑙𝑙 = 1,6 𝐴 ( 10 )

The difference between the real and theoretical voltages results in the losses and thereby the

heat is produced in the PEM stack, which can be calculated as π‘„π»π‘’π‘Žπ‘‘,π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ , as shown in

section 3.1.3.

The value for 𝑉𝑐𝑒𝑙𝑙 is lowered by the operating temperature of the stack, thereby increasing

the efficiency of the stack. Here, the working temperature of the process water and the stack

are set to 80Β°C. The process water is under normal continuous operation preheated by the

recovered waste heat from the stack itself by a heat exchanger. The water is assumed to be

20Β°C before preheating and the preheating demand can be calculated as the following:

π‘„π‘π‘Ÿπ‘’β„Žπ‘’π‘Žπ‘‘π‘–π‘›π‘” = οΏ½οΏ½π‘€π‘Žπ‘‘π‘’π‘Ÿ βˆ— πΆπ‘π‘€π‘Žπ‘‘π‘’π‘Ÿ βˆ— (π‘‡π‘‚π‘π‘’π‘Ÿπ‘Žπ‘‘π‘–π‘›π‘” βˆ’ π‘‡π‘–π‘›π‘π‘œπ‘šπ‘šπ‘–π‘›π‘”) ( 11 )

The process water then forms H2 at the cathode and O2 at the anode with traces of water and

small amounts of incorrectly produced gas. The flows are then purified and the moisture and

formed water are removed, see section 3.1.4 for details.

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3.1.1 Ohmic losses

The ohmic losses are caused by the internal resistances of the PEM cells that lead to losses in

the component in the cells. This will cause a voltage drop and hence the difference between

𝑉𝑐𝑒𝑙𝑙 and π‘‰π‘‘β„Žπ‘’π‘œπ‘Ÿπ‘’π‘‘π‘–π‘π‘Žπ‘™π‘™. A linear correlation can be seen between the ohmic losses and the

current density in the cells and it can be predicted [12]. This is considered out of scope for

this project and the losses are considered and compensated for with the higher voltage

assumed for 𝑉𝑐𝑒𝑙𝑙.

3.1.2 Faradaic losses

Faradaic losses are the losses correlated to the current applied to each cell that does not result

in produced H2 or O2 [12]. An example of this is the gases that are affected by gas crossover,

which are connected to the faradaic losses, see more in section 2.5.3.

3.1.3 Heat production

While H2 is the desired gas from the reaction, heat and O2 are produced as byproducts. The

production of O2 will be handled in section 3.1.4.

The amount of heat generated in each cell can be calculated with the assumed 𝑉𝑐𝑒𝑙𝑙 and 𝐼𝑐𝑒𝑙𝑙,

along with π‘‰π‘‘β„Žπ‘’π‘œπ‘Ÿπ‘’π‘‘π‘–π‘π‘Žπ‘™π‘™ as the following:

π‘„π»π‘’π‘Žπ‘‘,𝑐𝑒𝑙𝑙 = (𝑉𝑐𝑒𝑙𝑙 βˆ’ π‘‰π‘‘β„Žπ‘’π‘œπ‘Ÿπ‘’π‘‘π‘–π‘π‘Žπ‘™π‘™) βˆ— 𝐼𝑐𝑒𝑙𝑙 ( 12 )

The total heat generated in the electrolyzer can then be calculated by multiplying π‘„π»π‘’π‘Žπ‘‘,𝑐𝑒𝑙𝑙

by the number of cells in the stack n:

π‘„π»π‘’π‘Žπ‘‘,π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ = π‘„π»π‘’π‘Žπ‘‘,𝑐𝑒𝑙𝑙 βˆ— 𝑛𝑐𝑒𝑙𝑙𝑠 ( 13 )

This represents the unwanted production of heat in the electrolyzer stack, which is the amount

of cooling demand.

Along with the cooling demand for the stack, several lesser cooling flows are required. The

produced H2 and O2 flows are exiting the stack at 80Β°C and need to be cooled for further

treatment and purification. The amount of heat that can be recovered from these smaller flows

can be calculated as:

π‘„π‘™π‘’π‘ π‘ π‘’π‘Ÿ π‘π‘œπ‘œπ‘™π‘–π‘›π‘” π‘“π‘™π‘œπ‘€π‘  = οΏ½οΏ½π‘”π‘Žπ‘  βˆ— πΆπ‘π‘”π‘Žπ‘  βˆ— (π‘‡π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ βˆ’ π‘‡π‘‘π‘’π‘ π‘–π‘Ÿπ‘’π‘‘) ( 14 )

Where π‘‡π‘‘π‘’π‘ π‘–π‘Ÿπ‘’π‘‘ is the desired cooling temperature for the target gas.

3.1.4 Water formation in anode/cathode and unwanted gas in the production

flows

Since the gas production is not 100% flawless or lossless, some amount of unwanted gas and

water will form in the anode and cathode. The quantities of the produced gases ending up in

the correct electrode can be estimated according to a faradaic efficiency, here assumed as

99% based on other literature [12][18].

Based on the faradaic efficiency and the assumed current 𝐼𝑐𝑒𝑙𝑙 multiplied with the number of

cells in the PEM stack, a relationship can be used to determine the amount of produced gases

in the anode and cathode, as the following:

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𝑛𝐻2 π‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’ =πΌπ‘‘π‘œπ‘‘π‘Žπ‘™

2βˆ—πΉβˆ— Ζžπ‘“π‘Žπ‘Ÿπ‘Žπ‘‘π‘Žπ‘–π‘ ( 15 )

𝑛𝑂2 π‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’ =πΌπ‘‘π‘œπ‘‘π‘Žπ‘™

4βˆ—πΉβˆ— (1 βˆ’ Ζžπ‘“π‘Žπ‘Ÿπ‘Žπ‘‘π‘Žπ‘–π‘) ( 16 )

𝑛𝐻2 π‘Žπ‘›π‘œπ‘‘π‘’ =πΌπ‘‘π‘œπ‘‘π‘Žπ‘™

2βˆ—πΉβˆ— (1 βˆ’ Ζžπ‘“π‘Žπ‘Ÿπ‘Žπ‘‘π‘Žπ‘–π‘) ( 17 )

𝑛𝑂2 π‘Žπ‘›π‘œπ‘‘π‘’ =πΌπ‘‘π‘œπ‘‘π‘Žπ‘™

4βˆ—πΉβˆ— Ζžπ‘“π‘Žπ‘Ÿπ‘Žπ‘‘π‘Žπ‘–π‘ ( 18 )

Assuming that the flows of produced H2 and O2 gas are saturated with water vapor at 80Β°C,

the amount of initially formed water can be calculated accordingly:

𝑛𝐻2𝑂 π‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’ =π‘ƒπ‘ π‘Žπ‘‘π‘’π‘Ÿπ‘Žπ‘‘π‘’π‘‘

(π‘ƒπ‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’βˆ’π‘ƒπ‘ π‘Žπ‘‘π‘’π‘Ÿπ‘Žπ‘‘π‘’π‘‘)βˆ— (𝑛𝐻2 π‘Žπ‘›π‘œπ‘‘π‘’ + 𝑛𝐻2 π‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’) ( 19 )

𝑛𝐻2𝑂 π‘Žπ‘›π‘œπ‘‘π‘’ =π‘ƒπ‘ π‘Žπ‘‘π‘’π‘Ÿπ‘Žπ‘‘π‘’π‘‘

(π‘ƒπ‘Žπ‘›π‘œπ‘‘π‘’βˆ’π‘ƒπ‘ π‘Žπ‘‘π‘’π‘Ÿπ‘Žπ‘‘π‘’π‘‘)βˆ— (𝑛𝑂2 π‘Žπ‘›π‘œπ‘‘π‘’ + 𝑛𝑂2 π‘π‘Žπ‘‘β„Žπ‘œπ‘‘π‘’) ( 20 )

The O2 that crosses into the H2 gas will eventually react with a small amount of H2 and form

water, and vice versa for the O2 flow.

3.2 Mass and Energy balance To better understand the process in the PEM electrolyzer, mass and energy balances were

calculated in the early stages of the project. For the major molar flow streams, see Figure 5.

Figure 5: Molar flow for the electrolyzer model, used in the mass balance.

For the mass balance, the sum of the mass for the produced gases must be the same as the

sum of mass for the inlet water, as the following:

βˆ‘ ��𝑂𝑒𝑑 = βˆ‘ ��𝐼𝑛 ( 21 )

Where the theoretical sum is:

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��𝑖𝑛 = οΏ½οΏ½π‘€π‘Žπ‘‘π‘’π‘Ÿ = π‘›π‘€π‘Žπ‘‘π‘’π‘Ÿ βˆ— π‘€π‘€π‘Žπ‘‘π‘’π‘Ÿ ( 22 )

οΏ½οΏ½π‘œπ‘’π‘‘ = ��𝐻2 + ��𝑂2 = 𝑛𝐻2 βˆ— 𝑀𝐻2 + 𝑛𝑂2 βˆ— 𝑀𝑂2 ( 23 )

Where M is the molar mass for H2, O2, and H2O respectively.

In reality, some losses in the production will occur, according to the relations presented in

section 3.1.4, and must be added to the οΏ½οΏ½π‘œπ‘’π‘‘ equation to complete the equilibrium. No deeper

calculations have been made of the production volumes beyond considering the equations

above in section 3.1.4 since it is considered out of scope in this project.

For the flow and division of the energy, see Figure 6.

Figure 6: Energy flow for the electrolyzer model.

We know from the first law of thermodynamics that the sum of energy out from the system

must be equal to the sum of energy into the system.

βˆ‘ 𝑄𝑂𝑒𝑑 = βˆ‘ 𝑄𝐼𝑛 ( 24 )

Where the electricity demand for the surrounding equipment, such as pumps and compressors

can be subtracted in both equations, resulting in:

𝑄𝑖𝑛 = π‘Šπ‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ ( 25 )

π‘„π‘œπ‘’π‘‘ = π‘„β„Žπ‘’π‘Žπ‘‘,π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ + 𝑄𝐻2 + 𝑄𝑂2 ( 26 )

Since the heating value for the O2 gas is zero, it means that 𝑄𝑂2 = 0. The energy in the H2 gas

can be calculated as the following:

𝑄𝐻2 = ��𝐻2 βˆ— 𝐻𝐻𝑉𝐻2 ( 27 )

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Where HHV is the higher heating value for H2 gas. The heat produced in the stack,

π‘„β„Žπ‘’π‘Žπ‘‘,π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ, can be calculated according to the earlier mentioned equation in section

3.1.3.

The energy consumption for the water pump and the compressor can be seen respectively

below:

π‘Šπ‘€π‘Žπ‘‘π‘’π‘Ÿ π‘π‘’π‘šπ‘ =π‘‰Β΄π‘€π‘Žπ‘‘π‘’π‘Ÿ βˆ— (β„Ž2π‘ βˆ’β„Ž1)

πœ‚π‘’π‘™,π‘π‘’π‘šπ‘ βˆ— πœ‚π‘–π‘ π‘’π‘›π‘‘π‘Ÿπ‘œπ‘π‘–π‘,π‘π‘’π‘šπ‘ ( 28 )

Where πœ‚π‘’π‘™ and πœ‚π‘–π‘ π‘’π‘›π‘‘π‘Ÿπ‘œπ‘π‘–π‘ are assumed to 0,9 and 0,8 respectively.

π‘Šπ‘π‘œπ‘šπ‘π‘Ÿπ‘’π‘ π‘ π‘œπ‘Ÿ = οΏ½οΏ½π‘”π‘Žπ‘  βˆ— π‘π‘π‘”π‘Žπ‘  βˆ— (π‘‡π‘Žπ‘“π‘‘π‘’π‘Ÿ βˆ’ π‘‡π‘π‘’π‘“π‘œπ‘Ÿπ‘’) ( 29 )

Where π‘‡π‘Žπ‘“π‘‘π‘’π‘Ÿ can be calculated as:

π‘‡π‘Žπ‘“π‘‘π‘’π‘Ÿ = π‘‡π‘π‘’π‘“π‘œπ‘Ÿπ‘’ + ((273,15+π‘‡π‘π‘’π‘“π‘œπ‘Ÿπ‘’)

πœ‚π‘–π‘ π‘’π‘›π‘‘π‘Ÿπ‘œπ‘π‘–π‘,π‘π‘œπ‘šπ‘π‘Ÿπ‘’π‘ π‘ π‘œπ‘Ÿ) βˆ— ((

π‘ƒπ‘Žπ‘“π‘‘π‘’π‘Ÿ

π‘ƒπ‘π‘’π‘“π‘œπ‘Ÿπ‘’)

((π›Ύπ‘”π‘Žπ‘ βˆ’1)

π›Ύπ‘”π‘Žπ‘ )

βˆ’ 1) ( 30 )

Where πœ‚π‘–π‘ π‘’π‘›π‘‘π‘Ÿπ‘œπ‘π‘–π‘,π‘π‘œπ‘šπ‘π‘Ÿπ‘’π‘ π‘ π‘œπ‘Ÿ is assumed as 0,7 and π›Ύπ‘”π‘Žπ‘  a constant based on the ratio of the

gas Cp and Cv values.

Since the PSA purification unit is operating by a pressure differential, a compressor is needed

for operation. The work for the O2 PSA unit is hence calculated in the same way as the

equation for π‘Šπ‘π‘œπ‘šπ‘π‘Ÿπ‘’π‘ π‘ π‘œπ‘Ÿ above.

3.3 Efficiency Efficiency in this case can be defined in many ways, often in the way the author sees most fit.

The most common and relatable definition is the ratio between power supply and energy

output, in the form of the energy value in the gas, in this case, based on the HHV. This can be

represented in the following way:

Ξ·π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ

=𝐻𝐻𝑉𝐻2βˆ— π‘šπ»2

π‘„π‘‘π‘œπ‘‘π‘Žπ‘™ ( 31 )

Where HHV is the higher heating value of the H2 gas, m is the mass of the produced gas and

Q is the supplied energy into the system. This can be expanded further by considering the

extraction and use of the heat produced in the system, but that has not been a priority in this

project and has not been analyzed further.

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One more commonly used β€œefficiency” term is the specific energy consumption, or SEC,

which is defined by the supplied energy into the system per kg of produced H2, that is kWh /

π‘˜π‘”π»2.

𝑆𝐸𝐢 =π‘„π‘’π‘™π‘’π‘π‘‘π‘Ÿπ‘œπ‘™π‘¦π‘§π‘’π‘Ÿ

π‘šπ»2

( 32 )

3.4 Economy A budget offer request was sent out to a dozen different manufacturers, both in Sweden and

internationally, asking about important specifications related to the electrolyzer for

economical calculations. Since some important parameters and the electrolyzer size differed

between the different manufacturers, it was decided that a mean value was to be used for

important parameters that defined a base case in the economic calculations. See Table 4 and

Table 5 in section 3.4.2 below.

Several dialogs were also established under the project to different experts on companies,

universities, and organizations competent in the electrolyzer and hydrogen area, for

consultation and research purposes [3] [6] [5]. The discussion with the experts helped set the

important parameters, which is otherwise hard to obtain in open literature, such as the current

and future market of H2 and O2.

3.4.1 Production cost, payback time and Internal rate of return

The production cost, π‘ƒπ‘Ÿπ‘œπ‘‘π»2, was calculated as follows.

π‘ƒπ‘Ÿπ‘œπ‘‘π»2 =𝐢𝐴𝑃𝐸𝑋𝑖𝑖+ βˆ‘ 𝐸π‘₯π‘π‘ π‘Ÿ + βˆ‘ π‘‚π‘ƒπΈπ‘‹π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’βˆ’βˆ‘ 𝑅𝑒𝑣𝑂2,π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’βˆ’βˆ‘ π‘…π‘’π‘£π»π‘’π‘Žπ‘‘,π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’

π‘šπ»2 π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’ ( 33 )

Where 𝐢𝐴𝑃𝐸𝑋𝑖𝑖 is the initial investment cost, 𝐸π‘₯π‘π‘ π‘Ÿ is the expenditure for the stack

replacement, 𝑅𝑒𝑣𝑂2 is the revenue made from the sale of O2 and π‘…π‘’π‘£π»π‘’π‘Žπ‘‘ is the revenue made

from waste heat recovery. The payback time, π‘‘π‘π‘Žπ‘¦π‘π‘Žπ‘π‘˜, was calculated as follows.

π‘‘π‘π‘Žπ‘¦π‘π‘Žπ‘π‘˜ =𝐢𝐴𝑃𝐸𝑋𝑖𝑖+βˆ‘ 𝐸π‘₯π‘π‘ π‘Ÿ+βˆ‘ π‘‚π‘ƒπΈπ‘‹π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’βˆ’βˆ‘ 𝑅𝑒𝑣𝑂2,π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’βˆ’βˆ‘ π‘…π‘’π‘£π»π‘’π‘Žπ‘‘,π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’βˆ’βˆ‘ 𝑅𝑒𝑣𝐻2,π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’

βˆ‘ π‘‡π‘œπ‘‘π‘Žπ‘™ π‘–π‘›π‘π‘œπ‘šπ‘’π‘™π‘–π‘“π‘’π‘‘π‘–π‘šπ‘’

( 34)

Where 𝑅𝑒𝑣𝐻2 is the revenue made from the sale of H2. In addition, the internal rate of return

was calculated and later compared in a sensitivity analysis. The IRR can be derived from:

0 = 𝐢𝐴𝑃𝐸𝑋𝑖𝑖 βˆ’ βˆ‘πΆπ‘–

(1+𝐼𝑅𝑅)𝑖𝑛𝑖=1 ( 35 )

In this project, the function IRR in excel was used and no major emphasis was placed on

using the equation above. A sensitivity analysis was made for both cases with the IRR set as

the outcome value, with governing parameters differing in value from -100% to +100% from

the base case. The results can be seen in Table 9 and Table 10 in section 4.

Page 23: Integration of Hydrogen Production via Water Electrolysis

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3.4.2 Input data for the base case

Below are two tables consisting of the assumptions and mean values used for the base case of

the PEM electrolyzer.

Table 4: Mean values of the economic parameters, taken from response of the budget offer.

Mean values:

Parameter Value Unit

Stack Lifetime 68000 hours

Electrolyser price 13800 SEK/kW

Electrolyzer size 1,4 MW

Maintenance (as a % of the

CAPEX per year) 3,25 %

Stack replacement cost (as a

% of the original CAPEX) 35 %

The cost for maintenance and stack replacement in Table 4 is based on a percentage of the

initial investment cost, the CAPEX. The replacement of the electrolyzer stack takes place

after 68 000 hours of operation, when the efficiency of the cells in the stack have degraded

under a certain threshold set by the manufacturer. The cost of maintenance, on the other hand,

is on an annual basis.

Table 5: Assumptions used, a result from literature, discussing with competent individuals in

respective subject and with staff at E.ON [3] [4] [6] [12].

Assumptions: Linear Non-linear

Parameter Value Value Unit

Hydrogen selling price 55 55 SEK/kg

Oxygen selling price 0,5 0,5 – 0,2 SEK/kg

Earnings from heat

recovery to district

heating network

190 - 250 190 - 250 SEK/MWh

Unpredictable costs 100 100 %

Depreciation time 20 20 years

Electrical price (including taxes)

650 650 – 750 SEK/MWh

Amount of sellable

hydrogen gas 100 80 – 100 %

Amount of sellable

oxygen gas 80 70 – 100 %

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The assumptions and mean values from Table 4 and Table 5 make up the input data for the

base case. For the base case calculations, two scenarios were made:

β€’ Linear Case: Assuming the constant profit, expenditures, and usage over 20 years.

β€’ Non-Linear Case: Profit, expenditures, and usage vary every year based on the

variation in input data, such as electrical price, H2 price, operational hours, etc. The

economic lifetime was kept for 20 years to be comparable with the linear case.

In both cases, the payback time, production cost for H2, and the internal rate of return were

examined, along with several sensitivity analyses on the linear case.

3.4.3 Linear case

The linear case uses the assumptions from Table 5. In addition, it was assumed that 100% of

produced H2 can be sold, 80% of O2 can be sold, and a constant electrical price of 650

SEK/MWh.

Table 6: Input values for the linear case.

The initial CAPEX cost, stack replacement costs, and the gross revenue were received from

the input data and used with the function IRR in excel to investigate the internal rate of return

for the case.

The payback time and the H2 production cost were also calculated according to equations 33

and 34 above. The payback time and production cost were also set as the resulting variables

in a series of different sensitivity analyses for the linear case, investigating the effect of

governing parameters.

3.4.4 Non-linear case

The electricity price is increasing annually and the selling price for H2 gas is expected to

steadily decline as a result of increasing demand for H2 and a larger number of suppliers in

the future, competing in the market and pushing down the H2 prices [12][20][28][32].

Research and development will also increase the lifetime of the stack and decline the cost for

electrolyzers in the future. A scenario is also likely to occur where the produced H2 and O2

are unable to generate full or any revenue due to a saturated, slow-developing, or absence of

market and it is interesting to include such scenarios. Here, it is included as a sellable

percentage of the produced gases. Since the linear case assumes all variables constant, the

purpose of the non-linear case is to be able to see the effects of an evolving electrical and H2

price, electrolyzer price, and lifetime development and market saturation, for a more realistic

estimation.

The assumptions used in the non-linear case use the numbers from Table 4 and Table 5.

Page 25: Integration of Hydrogen Production via Water Electrolysis

19

Table 7: Input values for the non-linear case.

For the sensitivity analysis on the non-linear case, all the values in each category for the 20-

year were scaled at the same percentage.

The same calculations for the production cost and payback time were made in the non-linear

case as well.

4 Results and discussion A common practice for manufacturers of PEM electrolyzers is to sell the electrolyzer itself

with necessary auxiliary equipment as a package, skid-mounted, delivered in a container

unless the size of the electrolyzer is very large [6]. These packages often include a process

water treatment system, the electrolyzer stack, a cooling circuit for the stack (with the cooling

system often mounted at the roof of the container), purification systems for the H2 gas, and

sometimes a first stage compressor. The choice of electrolyzer technology for this project was

based on a comparison between three considered technologies and the possibility for usage as

a fuel cell.

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Table 8: Comparison of the advantages and disadvantages with the considered technologies

[13][18][19][20][23][34][35].

ALK PEM SOEC

Maturity level: Commercial Commercial Development

Can be used as fuel

cell: No Yes Yes

Price:

(€/kW) < 1000 < 1600a > 2000b

System lifetime:

(Years) 20 + 10 + > 1b

Maintenance cost: High Lowa Highb

Contamination types: Trace of electrolyte

Trace of H2O Traces of H2O H2O

Startup time: < 1 hour < 15 min < 1 hourb

Load response time: Seconds Milliseconds Secondsb

Operational

temperature:

(Β°C)

~70-80 ~70-90 700-900

Purity level of

produced H2 gas:

(% H2)

~99,5 =< 99,99 ~99,9b

Operating pressure:

(Bar) < 30 < 100 < 20b

Stack lifetime:

(hours) > 70 000 ~70 000a < 20 000b

a = information partly from experts and manufacturers b = no reference provided; values estimated based on collected information

The results from the comparison are shown in Table 8, with the green letter indicate the

advantages of the technology. The PEM technology was chosen based on its many practical

advantages and relatively few drawbacks. The current rapid development of the PEM

technology was also a deciding factor.

The O2 gas usually contains moisture which needs removal before the gas usage. However, it

is rarely purified and most often just released into the surrounding air since it cannot be used

at the site of production or deemed uneconomical to purify and sell.

Page 27: Integration of Hydrogen Production via Water Electrolysis

21

Figure 7: Process scheme for how integration and placement of the PEM electrolyzer system

at E.ON could look like.

Figure 7 shows the suggestion of H2 and O2 production system from this study, with

integration with a CHP plant. Figure 8 Shows the resulted energy balance of the system in

Sankey diagram, and Figure 9 Shows the molar balance surrounding the electrolyzer.

Water is feed from a storage tank into the electrolyzer system, passing a heat exchanger to

preheat the water to operating temperature. The operating temperature is set to 80Β°C, which is

common in PEM electrolyzers to reduce losses [9] (see section 3.1). The water is feed into the

electrolyzer stack and when a voltage is applied, H2 and O2 are produced along with excess

heat. The excess heat is recovered with the cooling circuit and used to preheat the process

water before being used in the district heating network. From the 1,443 MW of electricity

input into the system, 0,341 MWh results in recovered heat, as can be seen in Figure 8. An

operational pressure of 5 bar in the anode and 30 bar in the cathode was set to minimize the

losses in the production flows since operation without pressurizing anode side leads to more

losses [12] and contamination in the form of H2O. Small amount of unwanted H2 and O2 end

up in their opposite streams along with small amounts of moisture. Based on the mass balance

and equations in section 3.1.4, ~1% of the total produced H2 and O2 will end up as unwanted

gas in the opposite flows, see Figure 9. The streams contain relatively low levels of

contamination but are still in need of purification. In this project, a vertical collection tank for

the removal of liquid water and a PSA unit for steam and unwanted gases is assumed to be

sufficient equipment for purification of the production flow since the purity level from the

PEM is quite high, as can be seen in Table 8. The H2 is then purified and ready for its final

usage. The moisture collected in the purification is circulated back to the process water

storage tank.

The pressure of the H2 gas after the PSA unit is 30 bar. Since most of the uses for H2 require

the gas to be at a higher pressure, the gas is compressed to 300 bar after the purification.

Since the usage of O2 is somewhat uncertain, the gas is not compressed and remains at

atmospheric pressure after the PSA unit.

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22

Figure 8: The resulting energy balance with the energy distribution in the system.

Figure 9: The molar balance with resulting production flows. Where the molar flows are

equal to a mass flow of 26,2 kg/h for the H2 and 207,6 kg/h for the O2. The required process

water flow in m3/h corresponds to 0,238 m3/h.

The entire year of operation corresponds to around 8500 hours, if we assume some time for

system startup/shutdown and maintenance. This results in a need to purchase tap water for

~4500 hours since the purification system at Γ…byverket can only provide purified process

water ~4000 hours a year, in the wintertime when both boilers are active. Figure 10 shows the

times when super-clean water from Γ…byverket is accessible, and with its corresponding

conductivity. Between March and October, the accessible water flow is low or nonexistent.

Page 29: Integration of Hydrogen Production via Water Electrolysis

23

Figure 10: The mean value per month for the waterflow and the conductivity for a typical

year.

As mentioned in section 2.5, the levels of different contaminations and conductivity of the

process water should preferably be kept low. The purification system at Γ…byverket are

already periodically treating tap water for the boilers under certain circumstances, and it could

be used to purify the required flow rate of tap water for the electrolyzer as well to minimize

the cost for purification.

After comparing the required mass flow of H2O from Figure 10, which correspond to 0,238

m3/h, and Figure 11, it is quite clear that the required amounts of super-clean water for the

electrolyzer operation exists at Γ…byverket from October to March. The quantities are large

enough to scale up the H2 production if the interest exists. The marginal earnings made for

providing purified process water from the CHP plant instead of purchasing and purifying tap

water are unfortunately lower than 0,1 SEK/π‘˜π‘”π»2 and are thus neglectable compared to e.g.

Electricity costs, as can be seen in Figure 11 below:

0

5

10

15

20

25

30

Jan Feb Mars April May June July Aug Sep Oct Nov Dec

Flo

w i

n m

3/h

Con

du

ctiv

ity

in

ΞΌS

/cm

2

Water flow and conductivity

Super-pure

Water flow

Conductivity

Page 30: Integration of Hydrogen Production via Water Electrolysis

24

Figure 11: Annual expenditures and revenue from the Linear case.

The main revenue, as seen in Figure 11, comes from the sale of H2, with a smaller income

from the O2. The possible earnings for the recovery of waste heat are noticeable but will not

be relevant at this small size of electrolyzers (1,4MW). Even though the warm water flow

produced from the electrolyzer’s cooling system is quite small in comparison to the facility’s

current district heating system in this case, the heat can still be of use. A relatively small

profit is proven possible. This profit would otherwise be wasted if the placement of the

electrolyzer was off-site, and corresponds to ~1,6 SEK per kg produced H2.

Likewise, the cost for maintenance, which is the second-largest OPEX expense, affects the

outcome very little due to overwhelming share of electricity cost. Nevertheless, the process

water for the machine should be as clean as possible. Therefore, the purchased tap water,

should undergo purification on Γ…byverkets existing system to minimize wear on the PEM

stack and membrane if possible. Regarding the OPEX of the electrolyzer, it is quite clear that

the electricity price is the largest expense and will have a large effect on the profitability and

therefore the production cost for H2, as seen in Figure 11. Uncertainty and fluctuation in the

electricity price will have a big impact on the yearly profit. The electricity price is directly

linked to the production cost for the H2 in addition to the CAPEX and stack replacements.

And while the assumption of 35% of the initial CAPEX seems high for the replacement cost

of stack after its lifetime, the continuous development and the expected drop in electrolyzer

price makes this cost less impactful and less of a concern as time passes [20][27][32].

From participation in webinars with different companies [6][27][32], the price for

electrolyzers are expected to fall in the coming years and the largest part of the CAPEX is

from the initial investment. So, from a CAPEX perspective, it may be beneficial to postpone

0

2

4

6

8

10

12

OPEX Revenue

M S

EK

Annual Revenue and OPEX

Waste Heat Recovery

Maintenance

EL, Waterpump

EL, 300 Bar H2

EL, PSA, O2

EL, Electrolyzer

Water Treatment

O2 Sale

H2 Sale

Page 31: Integration of Hydrogen Production via Water Electrolysis

25

the investment for a drop in CAPEX cost and a more mature market. There is also a

connection between the size of the electrolyzer facility and the electrolyzer price. A larger

size will lead to a lower specific cost (SEK/kW). It is also hard to estimate a feasible mean

value for electrolyzers since the specific cost can differ up to 100% between manufacturers.

While postponing the investment can lead to a smaller CAPEX cost. An early investment

might on the other hand have a positive commercial impact, since the interest in H2 in

different applications is growing exponentially. Investment in green H2 production may result

in a positive environmental awareness image for the company.[6][38]

Unpredictable cost is one of the biggest uncertainties in the CAPEX calculations. Some

companies are using factors of up to 3 [3], which means that the initial investment cost is

increased by 300% due to uncertainties, while in this project, 100% is assumed. The initial

investment cost includes the PEM electrolyzer with auxiliary systems, storage equipment and

cost for installation. This does not include the cost for periodic electrolyzer stack

replacements. The initial cost is then multiplied with the uncertainty factor, in this case

doubling the initial investment cost (CAPEX). The assumption of 100% is since the

electrolyzer system is skid-mounted and delivered complete in a container, with only water,

electrical, and gas connections to be made with low problematic in the placement.

The assumption has also been made that the produced H2 generates an income directly after

the production since the study has not been able to investigate the cost for infrastructure and

final usage because of time constraints.

From the base case, the lifetime cost-benefit analyses for linear and non-linear cases were

developed. Their respective depreciation curve, resulting from the assumptions and mean

values from Table 4 and Table 5 can be seen in Figure 12 and Figure 13.

Figure 12: The linear case, resulting in a profitable investment.

In Figure 12 and Figure 13, CAPEX represents the initial and stack replacement costs.

Revenue is annual revenue, and the total cash flow is the sum of the annual earnings.

-60

-40

-20

0

20

40

60

80

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

M S

EK

YEARS

LINEAR DEPRECIATION CURVE

CAPEX

Revenue

Total

cash flow

Payback

time

Page 32: Integration of Hydrogen Production via Water Electrolysis

26

Figure 13: The non-linear case, illustrating the effect of changing parameters.

The fluctuation and change in the electrical price and sell price of H2 will affect the results of

the IRR quite a bit, as seen in Figure 12 and Figure 13.

Figure 12 and Figure 13 represent the results of the two cases with total cash flow as the

purple line. Since many variables are uncertain and hard to predict over 20 years, a sensitivity

analysis was made with the internal rate of return as an indicator to investigate the outcome in

terms of profitability. The results for both cases can be seen below:

Table 9: The results from the sensitivity analysis of different variables affecting the Interest

rate on the linear case. Parameters: Original values: -100% -75% -50% -25% 0% +25% +50% +75% +100%

Hydrogen sell price (SEK/kg) 55 - INVALID INVALID -13,79% 1,73% 9,67% 16,21% 22,23% 28,01%

Sellable hydrogen (% of production) 100 INVALID INVALID INVALID -13,79% 1,73% - - - - Oxygen sell price (SEK/kg) 0,5 -1,01% -0,29% 0,41% 1,09% 1,73% 2,36% 2,97% 3,56% 4,14%

Sellable oxygen (% av production) 80 -1,01% -0,29% 0,41% 1,09% 1,73% - - - - Heat earnings winter (SEK/MWh) 200 0,63% 0,91% 1,19% 1,46% 1,73% 2,00% 2,27% 2,53% 2,78%

Heat earnings summer (SEK/MWh) 10 - - - - - - - - - Electrical price (SEK/MWh) 650 - 17,78% 13,06% 7,89% 1,73% -7,67% INVALID INVALID INVALID Electrolyzer price (SEK/kW) 13 800 - 16,69% 9,25% 4,84% 1,73% -0,66% -2,62% -4,28% -5,74%

Unpredictable costs (% of CAPEX) 100 7,83% 5,81% 4,20% 2,86% 1,73% 0,76% -0,10% -0,86% -1,55%

Operational hours (h/year): 8760 - -8,84% -4,11% -1,23% 1,73% - - - -

Figure 14: Graphical representation of the results from Table 9.

We can see in Figure 14 and Figure 15, that the H2, electrolyzer, and electricity price are

significantly influencing variables.

-60

-40

-20

0

20

40

60

80

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

M S

EK

YEARS

NON-LINEAR DEPRECIATION CURVE

CAPEX:

Total cash

flowPayback

timeRevenue

-20,00%

-15,00%

-10,00%

-5,00%

0,00%

5,00%

10,00%

15,00%

20,00%

25,00%

30,00%

35,00%

-100% -75% -50% -25% 0% +25% +50% +75% +100%Inte

rnal

Rat

e o

f R

etu

rn

Variable change

Sensitivity Analysis - Linear Case

Hydrogen sell price (SEK/kg)

Amount of hydrogen (% of production)

Oxygen sell price (SEK/kg)

Amount of oxygen (% av production)

Heat earnings winter (SEK/MWh)

Electrical price (SEK/MWh)

CAPEX, Electrolyzer price (SEK/kW)

Unpredictable costs (% of CAPEX)

Operational hours (h/year):

Page 33: Integration of Hydrogen Production via Water Electrolysis

27

Table 10: The results from the sensitivity analysis of different variables affecting the Interest

rate on the non-linear case. Parameter: Original values: -100% -75% -50% -25% 0% +25% +50% +75% +100%

Hydrogen sell price (SEK/kg) 55 - 45 - INVALID INVALID INVALID -28,00% 2,33% 9,73% 15,60% 20,85%

Sellable hydrogen (% of production) 80 - 100 INVALID INVALID INVALID INVALID

- - - - Oxygen sell price (SEK/kg) 0,5 - 0,2 INVALID INVALID INVALID INVALID -28,00% -14,56% -11,59% -9,59% -8,02%

Sellable oxygen (% av production) 80 - 100 INVALID INVALID INVALID INVALID

- - - - Heat earnings winter (SEK/MWh) 200 INVALID INVALID INVALID INVALID -28,00% -16,04% -13,47% -11,78% -10,49%

Heat earnings summer (SEK/MWh) 10 - - - - - - - - - Electrical price (SEK/MWh) 650 - 745 - 14,35% 8,86% 1,88% -28,00% INVALID INVALID INVALID INVALID Electrolyzer price (SEK/kW) 13 800 - 7800 - 2,98% -4,16% -10,58% -28,00% INVALID INVALID INVALID INVALID

Unpredictable costs (% of CAPEX) 100 -14,05% -16,50% -20,90% -24,00% -28,00% INVALID INVALID INVALID INVALID Operational hours (h/year): 8760 - INVALID INVALID -13,37% -28,00% - - - -

Figure 15: Graphical representation of the results from Table 10.

As stated before, the electrical price and the H2 selling price are the two most influential

variables in terms of profitability. It is also worth noting here that a +100% to -100%

difference in the change of the separate variables are extreme cases but gives an idea of how

the internal rate of return will be affected. We can also see that the electrolyzer must be

operational 8760 hours a year to be profitable, at least with the current price assumption for

electricity of 650 SEK/MWh and H2 selling price of 55 SEK/kg.

The price for natural gas today is ~10 SEK/kg [10]. From talking with experts and

organizations, a feasible price that some companies are willing to pay for green H2 instead of

natural gas or H2 produced by fossil fuels was estimated to be around 30 SEK/kg, which is the

target production price of H2 [6][31][3]. Some experts [31] claim that the price for H2

produced by water electrolysis must drop to around 15 SEK/kg to be able to compete with

fossil produced H2 or natural gas. At first glance, this claim can seem rather unrealistic.

However, several experts are predicting and expecting the price of H2 to reach those levels in

a near future [31][3][37]. The results from the linear and non-linear production costs can be

seen below, over a 20-year operational time:

-40,00%

-30,00%

-20,00%

-10,00%

0,00%

10,00%

20,00%

30,00%

-100% -75% -50% -25% 0% +25% +50% +75% +100%

Inte

rnal

Rat

e o

f R

eturn

Variable change

Sensitivity Analysis - Non linear Case

Hydrogen sell price (SEK/kg)

Amount of hydrogen (% of production)

Oxygen sell price (SEK/kg)

Amount of oxygen (% av production)

Heat earnings winter (SEK/MWh)

Electrical price (SEK/MWh)

CAPEX, Electrolyzer price (SEK/kW)

Unpredictable costs (% of CAPEX)

Operational hours (h/year):

Page 34: Integration of Hydrogen Production via Water Electrolysis

28

Table 11: The H2 production price, electricity price and payback time of the two different

cases.

CASE: LINEAR NON-LINEAR

H2 PRODUCTION

PRICE: 53,4 SEK/kg 58,1 SEK/kg

ELECTRICAL PRICE: (INCLUDING TAXES)

650 SEK/MWh 650 – 750 SEK/MWh

PAYBACK TIME 18,2 Years > 20 Years

As mentioned earlier, the electricity price is a driving factor in the production price. Sweden

has a different tax on electricity compared to other countries in Europe. Portugal, for

example, had electricity prices of 100 SEK/MWh during the summer of 2020 from solar cell

production [21]. If the price of electricity in Sweden fall as low as that summer in Portugal,

H2 production by electrolyzers would be very competitive with its fossil fuel counterparts. An

electrical price of 100 SEK/MWh would result in a production cost of ~18,4 SEK/kg for the

linear case and ~18,2 SEK/kg for the non-linear case. The electricity price needs to be ~290

SEK/MWh for an H2 production cost to become below 30 SEK/kg.

5 Conclusions To answer the question if it is possible to integrate a PEM electrolyzer at a CHP plant in a

resource-efficient way, the answer is yes. But the profitability of the investment is highly

dependent on a number of uncertain factors, such as electricity price and the potential market

for H2 gas. Integration and implementation of the electrolyzer at E.ON are expected to be of

low complexity.

The expected initial cost for a 1,4 MW PEM electrolyzer with auxiliary systems is

approximately 50 Milllion SEK (62 including stack replacements). The payback time for the

assumed base-case is 18 years, with an IRR of 1,73%. However, given the uncertainties that

exist, the IRR may vary between approximately IRR < 0% and 35%.

If the electricity price is lower or the H2 selling price is higher compared to the base case,

good profitability can be expected, assuming the prices are market competitive. This also

assumes guaranteed stable sales of the H2.

Important areas like the internal usage of O2 at E.ON and the cost for infrastructure require

further work and research to be entirely certain of the profitability. These, among other areas,

will most certainly have an unknown effect on the results and needs to be investigated for a

final verdict to be made.

Page 35: Integration of Hydrogen Production via Water Electrolysis

29

6 Future work Since there was not enough time to investigate all the possible usages and benefits with H2

production on a CHP plant, some areas have not been investigated. These areas require

further work in order to determine the actual potential of the proposed process integration.

The most important areas for continued work are listed below.

6.1 Internal usage of O2 The benefits that the O2 gas can contribute to are not investigated under this project, due to

time constraints. A possible profit can be made from the usage of extra O2 gas in the process

air for the combustion process. This in turn could lead to a different ratio of exhaust gases,

such as a lower percentage of NOx or CO2 emissions. That could lead to a lower tax, and

possibly lower the cost for the plant and the environmental impact.

6.2 Market for H2 and O2 The economical calculations in this project assume that the produced gas is sold directly when

it is produced. In reality, there are several stages between the end of the production and its

final use. If there is no internal usage in the CHP plant, all the gases are either sold or stored.

Deeper insight is needed on the local and regional market for H2 gas and the potential

customers and consumers of H2 and possibly O2 gas.

6.3 Infrastructure No depth work has been carried out in the infrastructure area. This is an important area that

will include possible final usages for the gases and the costs for the needed infrastructure

surrounding them. Some possible scenarios are compression for storage or selling the gas,

usage internally with the need of a tanking station for vehicles, or by a local gas network for

distribution around the Γ–rebro area.

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30

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